Time to end medieval use of our maritime assets

26 Jan 2006

Article by John Blundell in The Scotsman

WITH the exception of Norway, Scotland has the longest seashore of any European country. Whereas the Norwegian cliffs fall into deep seas almost instantly, Scotland's are shallow and accessible. The endless indented coastline of the west and also of the Northern Isles creates what is clearly a vast opportunity - no, neither oil nor gas.

We are so familiar with the idea of the Scots countryside being divided into fields owned by different farmers we do not think about it. Yet it is the demarcation of property rights that allows a tiny number of farmers to feed us all.

It used to be that nobody owned anything. There were hunter gatherer bands who picked berries and hunted deer. We still run the seas, including the maritime foreshore, in that very same primitive way.

It is my argument that without ownership being defined, economic activity cannot emerge.

The "Tragedy of the Commons" was precisely an absence of tradable claims. Being owned by "everyone" really means nobody. Scotland's seas are only just becoming allocated and therefore valuable.

These reflections of political economy are based on gastronomy, namely my admiring the juicy mussels that I was recently served in a restaurant. I was curious to trace their story.

The answer is the Isle of Shuna, a little but inventive plc which is harvesting thousands of tonnes of mussels from their dangling ropes in sealochs.

This is low-fat, high-protein food that grows almost by magic without feeding or supplements. The warm Gulf Stream caresses the mussels and the plankton feeds them. So these succulent shellfish reach my table and my pleasure.

On an average of 0.5 kilograms each year, our consumption of mussels is far beneath the continental average of three kilograms per head. I offer the prediction that, before long, mussels and chips will be cheaper than fish and chips. That is not a light-hearted prediction. Cod and other fish are on their way to extinction as they still swim in the "no-man's land" of the seas.

So endangered are these creatures, the fishing fleets will have to be kept in dock... or people will have to agree property rights. Cod are travelling the same path to oblivion as Scotland's wild bison and cattle - extinct because they were husbanded by nobody.

My argument applies not just to mussels. It is to illustrate a point lost on our politicians.

Scotland's shores are not yet owned by anybody. So they remain grossly under-used - 96 per cent of the shoreline is owned by the Crown Estate. I think it fair to say nobody intended this. It is a historical anomaly.

What we need is an extensive auction of Scotland's maritime assets - freehold or leased. At its most basic it may be easy access to aggregates, stones for construction and roads.

My intuitive guess is that creating a market where none has ever existed will spark into life ideas not imagined. This could be a great adventure as well as good business.

The venture of the Isle of Shuna team is only 20 years old but they have created an industry where none existed. Admirable though they no doubt are, my theme is that we could astonish ourselves still further if we allocated tradable property rights in our maritime terrain as we do on land.

In one sense what I'm saying is obvious. Yet here we are into the 21st century adhering to a perception from the 13th century - that everything belongs to the Crown. Scotland's allocation of our inland shores is, precisely, medieval.

I'm not being original. A distinguished study, Markets Under The Sea, by the late Professor Donald Denman, is what ignited my imagination. He envisaged a host of uses for Scotland's vast mileage that is only half revealed at low tide. Other studies of Iceland and New Zealand show how their systems of essentially privatising the fish stock through an overall total allowable catch (TAC) and individual transferable share quotas (ITQs) have incentivised preservation of stocks by making over-fishing damaging to your overall wealth.

We have seen salmon tumble in price from delicacy to almost ordinary. The new expertise has hit problems but entrepreneurs are nimble and learn fast.

Salmon farming, as much as mussel farming, seems to me to illuminate an exciting future. As ever this does not need government initiatives or subsidies.The state need only get out of the way. Markets are our great discovery process. And when the incentives are right they are great preservers too.

John Blundell is Director General of the Institute of Economic Affairs.